Designing and Managing Integrated Marketing Communications
After reading this chapter, students should:
D) Know what is the role of marketing communications
E) Know how marketing communications work
F) Know what are the major steps in developing effective communications
G) Know what is the communications mix and how should it be set
H) Know what is an integrated marketing communications program
DETAILED CHAPTER OUTLINE
Modern marketing calls for more than developing a good product, pricing it attractively, and making it accessible. Companies must also communicate with present and potential stakeholders, and the general public. For most companies, the question is not whether to communicate but rather what to say, how to say it, to whom, and how often. But communications get harder and harder as more and more companies clamor to grab an increasingly empowered consumer’s divided attention. Consumers themselves are taking a more active role in the communication process and deciding what they want to receive and how they want to communicate to others about the products and services they use. To effectively reach and influence target markets, holistic marketers are creatively employing multiple forms of communications. Done right, marketing communications can have a huge payoff.
THE ROLE OF MARKETING COMMUNICATIONS
Marketing communications are the means by which firms attempt to inform, persuade, and remind consumers—directly or indirectly—about the products and brands that they sell.
(iii) Marketing communications represent the “voice” of the brand and are a means by which it can establish a dialogue and build relationships with consumers.
The Changing Marketing Communication Environment
Although marketing communications can play a number of crucial roles, they must do so in an increasingly tough communication environment.
Technology and other factors have profoundly changed the way consumers process communications and even whether they choose to process the information
Two forces are to blame for the demise of TV:
A) The fragmentation of the U.S. audience
B) The media we now use to reach them
Marketing, Communications, Brand Equity, and Sales
In this new communications environment, advertising is a central element but not or even the most important one.
Marketing Communications Mix
The marketing communications mix consists of eight major modes of communication:
B) Sales promotion
C) Events and experiences
D) Public relations and publicity
E) Direct marketing
F) Personal selling
G) Every brand contact delivers an impression that can strengthen or weaken a customer’s view of the company
Marketing Communication Effects
Marketing communication activities must be integrated to deliver a consistent message and achieve the strategic positioning desired.
h. Marketers need to assess which experiences and impressions will have the most influence at each stage of the buying process.
i. This understanding will help them allocate communications dollars more efficiently, design, and implement the right communication program.
j. Armed with these insights, marketers can judge marketing communications according to its ability to build brand equity and drive brand sales.
k. Marketers should evaluate all the different possible communication options according to effectiveness criteria.
l. Brand awareness is a function of the number of brand-related exposures and experiences accumulated by the consumer.
m. Anything that causes the consumer to notice and pay attention to the brand can increase brand awareness.
n. To enhance brand recall, more intense and elaborate processing may be necessary so that stronger brand links to the product category or consumer needs are established to improve memory performance.
o. All possible marketing communications options should be considered to create the desired brand image and knowledge.
The Communication Process Models
Marketers should understand the fundamental elements of effective communication. Two models are useful: a macro model and a micro model
Macro Model of the Communication Process
A) Two represent the major parties in a communication:
B) Two represent the major communication tools:
C) Four represent major communications functions
D) The last element is noise.
E) The model emphasizes the key factors in effective communication:
H) Senders must know what audiences they want to reach and what response they want to get.
I) They must encode their messages so that the target audience can decode them.
J) They must transmit the message through media that reaches the target audience.
K) Develop feedback channels to monitor the responses.
F) The more the sender’s field of experience overlaps with that of the receiver, the more effective the message is likely to be.
Micro Model of Consumer Responses
Micro models of marketing communications concentrate on consumer’s specific response to communications.
A) All these models assume that the buyer passes through a:
1) Cognitive stage
2) Affective stage
3) Behavioral stage (in that order)
B) This “learn-feel-do” sequence is appropriate when the audience has a high involvement with a product category perceived to have high differentiation.
C) An alternative sequence, “do-feel-learn” is relevant when the audience has high involvement but perceives little or no differentiation within the product category.
D) A third sequence, “learn-do-feel” is relevant when the audience has low involvement and perceives little differentiation within the product category.
E) By choosing the right sequence, the marketers can do a better job of planning communications.
F) Here we will assume that the buyer has high involvement with the product category and perceives high differentiation:
1) A hierarchy-of-effects model in the context of a marketing communication campaign:
G) To increase the odds for a successful marketing communications campaign, marketers must attempt to increase the likelihood that each step occurs.
DEVELOPING EFFECTIVE COMMUNICATIONS
There are eight steps in developing effective communications. The five basic are: identifying the target audience, determining the objectives, designing the communications, selecting the channels, and establishing the budget.
3) Identifying the Target Audience
A) The process starts with a clear target audience in mind.
Potential buyers of the company’s products
Current users, deciders, or influencers
Individuals, groups, or particular publics
B) The target audience is a critical influence on the communicator’s decisions on:
5) What to say
6) How to say it
7) When to say it
8) Where to say it
9) To whom to say it
C) Image analysis can be conducted to profile the target audience in terms of brand knowledge to provide further insight.
D) A major part of audience analysis is assessing the current image of the company, its products, and its competitors.
E) Image is the set of beliefs, ideas, and impressions a person holds regarding an object.
Determine the Communication Objectives
Communication objectives can be set at any level of the hierarchy-of-effects model.
A) Rossiter and Percy identify four possible objectives:
2) Category need
3) Brand awareness
4) Brand attitude
5) Brand purchase intention
B) The most effective communications often can achieve multiple objectives.
Design the Communication
Formulating the communication to achieve the desired response will require solving three problems: what to say (message strategy), how to say it (creative strategy), and who should say it (message source).
In determining message strategy, management searches for appeals, themes, or ideas that will tie into the brand positioning and help to establish points-of-parity or points-of-difference.
A) Some of these may be related directly to product or service performance:
G) Value of the brand
B) Where others may relate to more extrinsic considerations:
C) John Maloney saw buyers as expecting one of four types of reward from a product:
8) Ego satisfaction
Communication effectiveness depends on how a message is being expressed as well as the content of the message itself.
A) An ineffective communication may mean that the wrong message was used or the right message was expressed poorly.
B) Creative strategies are how marketers translate their messages into specific communication.
C) Creative strategies can be broadly classified as either “informational” or transformational appeals.
An informational appeal elaborates on product or service attributes or benefits.
A) Examples are:
4) Problem solving ads
5) Product demonstration ads
6) Product comparison ads
B) Informational appeals assume very rational processing of the communication on the part of the consumer—logic and reason “rule.”
C) There are three types of informational appeals:
5) Conclusion drawing
6) One-versus-two-sided arguments
7) Order of argument presentations
D) Each of these appeals has their supporters and distracters and depends heavily upon the target audience for the message.
A transformational appeal elaborates on a non-product-related benefit or image.
A) It might depict:
What kind of person uses a brand
What kind of experience results from using the brand
B) Transformational appeals often attempt to stir up emotions that will motivate purchase.
C) Communicators use negative appeals such as:
D) Messages are most persuasive when they are moderately discrepant with what the audience believes.
E) Communicators also use positive emotional appeals such as:
F) Motivational or “borrowed interest” devices are often employed to attract consumer attention and raise their involvement with an ad.
G) Borrowed interest techniques are thought to be necessary in the tough new media environment characterized by low involvement consumer processing and while competing with ad and programming clutter.
H) These borrowed interest approaches can attract attention and create more liking and belief in the sponsor, but they may also:
I) Attention getting tactics are often too effective and distract from brand or product claims.
J) One challenge in arriving at the best creative strategy is figuring out how to “break through the clutter” to attract the attention of the consumer—but still be able to deliver the intended message.
K) The magic of advertising is to bring concepts to life in the minds of the consumer target.
Messages delivered by attractive or popular sources can potentially achieve higher attention and recall.
A) What is important is the spokesperson’s credibility.
B) The three factors underlining credibility are:
C) The most highly credible source would be a person who scores high on all three dimension – candor, humor, and naturalness.
3) If a person has a positive attitude toward a source and a message, or a negative attitude toward both, a state of congruity is said to exist.
4) What happens if a consumer holds one attitude towards the source and another toward the product?
1) Attitude change will take place in the direction of increasing the amount of congruity between the two evaluations
D) The consumer will end up respecting one somewhat less or somewhat more.
E) The principle of congruity implies that communicators can use their good image to reduce some negative feelings toward a brand but in the process might lose some esteem with the audience.
Multinational companies wrestle with a number of challenges in developing global communications programs:
1) Whether the product is appropriate for a country
2) That the market segment they address is both legal and customary.
3) If the style of the ad is acceptable
4) Whether ads should be created at headquarters or locally.
e. Product – many products are prohibited in certain parts of the world.
f. Market Segment – television ads to children maybe prohibited in some countries
g. Style – comparative ads maybe prohibited
h. Local or global – many companies are attempting to build a global brand image by using the same advertising in all markets.
Select the Communication Channels
Selecting efficient channels to carry the message becomes more difficult as channels of communication become more fragmented and cluttered.
A) Communication channels may be personal and non-personal
Personal Communication Channels
Personal communication channels involve two or more persons communicating directly face-to-face, person to audience, over the telephone, or through e-mail.
Personal communication channels derive their effectiveness through individualized presentation and feedback.
Advocate channels consist of company salespeople contacting buyers in the target market.
Expert channels consist of independent experts making statements to target buyers.
Social channels consist of neighbors, friends, family members, and associates talking to target buyers.
Personal influence carries especially great weight in two situations:
)A With products that are expensive, risky, or purchased infrequently.
)B Where the product suggests something about the user’s status or taste
F) Communication researchers are moving toward a social-structure view of interpersonal communication.
1) They see society as consisting of cliques, small groups whose members interact frequently.
2) A liaison is a person who connects two or more cliques without belonging to either.
3) A bridge is a person who belongs to one clique and is linked to a person in another clique
G) Many companies are becoming acutely aware of the power of word of mouth or “buzz”.
In some cases, positive word of mouth happens in a natural way.
“Buzz” is managed
H) Companies can take several steps to stimulate personal influence channels to work on their behalf:
Identify influential individuals and companies and devote extra effort to them.
Create opinion leaders by supplying certain people with the product on attractive terms.
Work through community “influentials” such as presidents of social, religious, and other organizations.
Use influential or believable people in testimonial advertising.
Develop advertising that has high “conversation value”.
Develop word-of-mouth referral channels to build business.
Establish an electronic forum.
Use viral marketing.
a. Viral marketing involves passing on company-developed products, services, or information from user to user.
I) Marketers must be careful in reaching out to consumers.
1) Consumers can resent personal communications if unsolicited.
Non-Personal Communication Channels
Non-personal communication channels are communications directed to more than one person and includes media, sales promotions, events, and publicity.
3) Media includes print, broadcast, network, electronic, and display media.
4) Sales promotions consist of consumer promotions, trade promotions, and business and sales-force promotion.
5) Events and experiences include sports, arts, entertainment, and cause events.
6) Public relations include communications directed internally or externally to consumers, other firms, media, and government.
7) Much of the recent growth of non-personal channels has been with events and experiences.
h. A company can build its brand image through creating or sponsoring events.
i. Companies are searching for better ways to quantify the benefits of sponsorship and are demanding greater accountability.
F) Companies can create events designed to surprise the public and create a buzz.
G) The increased use of attention-getting events is a response to the fragmentation of the media.
1) The lasting effects of events on brand awareness, knowledge, or preference will depend upon the quality of the product, the event itself, and its execution.
Integration of Communication Channels
Although personal communication is often more effective than mass communication, mass media might be the major means of stimulating personal communication.
A) Mass communications affect personal attitudes toward behavior through a two-step process:
Ideas flow from mass media to opinion leaders.
Opinion leaders to the less media-involved population groups
B) This two-step flow has several implications:
The influence of mass media on public opinion is not as direct, powerful, and automatic as supposed.
)A It is mediated by opinion leaders
This two-step flow challenges the notion that consumption styles are primarily influenced by a “trickle-down” or “trickle up” effect from mass media.
)A People interact primarily with their own social groups and acquire ideas from opinion leaders in their group.
The two-step process suggests that mass communicators should direct messages specifically to opinion leaders and let them carry the message to others.
Establish the Total Marketing Communications Budget
One of the most difficult marketing decisions is determining how much to spend on promotion. Industries and companies vary considerably in how much they spend on promotion.
Companies decide on the promotion budget in four common ways:
e. the affordable method
f. percentage-of-sales method
the objective-and-task method
Many companies set the promotion budget at what they think the company can afford. This method completely ignores the role of promotion as an investment and the immediate impact on sales volume. It leads to uncertain annual budget, and makes long-range planning difficult.
Many companies set promotion expenditures at a specified percentage of sales (current or anticipated) or the sales price.
A) Supporters of the percentage-of-sales method see a number of advantages
M) Promotion expenditures will vary with what the company can “afford.”
N) It encourages management to think of the relationship among promotion cost, selling price, and profit per unit.
O) It encourages stability when competing firms spend approximately the same percentage of their sales on promotion.
B) The percentage-of-sales method has little to justify it.
F) It views sales as the determiner of promotion rather than as the result.
G) It leads to a budget set by the availability of funds rather than by market opportunities.
H) It discourages experimentation with countercyclical promotion or aggressive spending.
I) Year-to-year sales fluctuations interfere with long-range planning.
J) There is no logical basis for choosing the specific percentage.
K) It does not encourage building the promotion budget by determining what each product and territory deserves.
Some companies set their promotion budget to achieve share-of-voice parity with competitors
A) Two arguments are made in support of the competitive-parity method.
G) Competitors’ expenditures represent the collective wisdom of the industry.
H) Maintaining competitive parity prevents promotion wars.
I) Neither argument is valid.
The objective-and-task method calls upon marketers to develop promotion budgets by defining specific objectives, determining the tasks that must be performed to achieve these objectives, and estimating the costs of performing these tasks. The sum of these costs is the proposed promotion budget.
A) The objective-and-task method has the advantage of requiring management to spell out its assumptions about the relationship among dollars spent, exposure levels, trial rates, and regular usage.
B) A major question is how much weight marketing communications should receive in relation to alternatives such as product improvement, lower prices, or better service.
1) The answers depends on where the company’s products are in their life cycles
2) Whether they are commodities or highly differentiable products
3) Whether they are routinely needed or have to be “sold”.
4) Other considerations
C) Marketing communications budgets tend to be higher:
D) When there is low channel support.
E) Much change in the marketing program over time.
F) Many hard-to-reach customers
G) More complex customer decision-making
H) Differentiated products and non-homogeneous customer needs
I) Frequent product purchases in small quantities.
D) In theory, the total communications budget should be established so that the marginal profit from the last communications dollar equals the marginal profit from the last dollar in the best non-communications use.
E) Implementing this principle is not easy.
DECIDING ON THE MARKETING COMMUNICATIONS MIX
Companies must allocate the marketing communications budget over the six major modes of communication—advertising, sales promotion, public relations and publicity, events and experiences, sales force, and direct marketing.
A) Within the same industry, companies can differ considerably in their media and channel choices.
B) Companies are always searching for ways to gain efficiency by replacing one promotional tool with others.
C) The substitutability among promotional tools explains why marketing functions need to be coordinated.
Characteristics of the Marketing Communications Mix
Each communication tool has its own unique characteristics and costs.
Advertising can be used to build up a long-term image for a product or trigger quick sales.
C) Advertising can efficiently reach geographically dispersed buyers.
D) Certain types of advertising require large budgets; others do not.
E) Just the presence of advertising might have an effect on sales.
1) Consumers might believe that the advertised brand must offer a “good value”.
D) Because of the many forms of advertising, it is difficult to make generalizations however, the following qualities can be noted:
E) Amplified expressiveness
Companies use sales-promotion tools to draw a stronger and quicker buyer response.
E) Sales promotion can be used for short-run effects.
F) Sales-promotion offer three distinct benefits:
Public Relations and Publicity
Marketers tend to under-use public relations, yet a well-thought out program coordinated with the other promotion-mix elements can be extremely effective.
A) The appeal of public relations and publicity is based on three distinctive qualities:
1) High credibility
2) Ability to catch buyers off guard
Events and Experiences
A) There are many advantages to events and experiences:
Direct and Interactive Marketing
The many forms of direct marketing—direct mail, telemarketing, and Internet marketing—share three distinctive characteristics.
A) Direct marketing is:
Word of mouth also takes many forms online or off-line. Three noteworthy characteristics are:
Personal selling is the most effective tool at the later stages of the buying process, particularly in building up buyer preference, conviction, and action.
A) Personal selling has three distinctive qualities:
5. Personal interaction
Factors in Setting the Marketing Communications Mix
Type of Product Market
Communication allocations vary between consumer and business markets. Consumer markets tend to spend comparatively more on sales promotion and advertising.
A) Business marketers tend to spend comparatively more on personal selling.
B) In general, personal selling is used more with:
3) Risky goods
a. In markets with fewer and larger sellers.
D) Advertising combined with personal selling can increase sales in the business market over what would have resulted if there had been no advertising.
E) Corporate advertising can improve a company’s reputation and improve the sales force’s change of getting a favorable first hearing and early adoption of the product.
F) Personal selling can also make a strong contribution in consumer goods marketing.
G) An effectively trained company sales force can make four important contributions
Increased stock position
Key account management.
Communication tools vary in cost-effectiveness at different stages of buyer readiness
C) Advertising and publicity play the most important roles in the awareness-building stage.
D) Customer comprehension is primarily affected by advertising and personal selling.
E) Customer conviction is influenced mostly by personal selling
F) Closing the sale is influenced mostly by personal selling and sales promotion
G) Reordering is also affected mostly by personal selling, sales promotion, and somewhat by advertising.
Product Life-Cycle Stage
Communication tools also vary in cost-effectiveness at different stages of the product life cycle.
In the introduction stage:
4) Advertising and publicity have the highest cost-effectiveness.
5) Followed by personal selling to gain distribution coverage
6) Sales promotion to induce trial
In the growth stage:
1) Demand has its own momentum through word-of-mouth.
In the maturity stage:
6) Sales promotion
8) Personal selling all grow more important in that order.
In the decline stage:
1) Sales promotion continues strong.
2) Advertising and publicity are reduced
3) Salespeople give the product only minimal attention.
Measuring Communication Results
Senior managers want to know the outcomes and revenues resulting from their communications investments.
Too often, communications directors supply only outputs and expenses.
After implementing the communication plan, the communications director must measure its impact on the target audience.
Members of the target audience are asked:
)D Whether they recognize or recall the message.
)E How many times they saw it.
)F What points they recall.
)G How they felt about the message.
)H Previous and current attitudes toward the product and the company
D) The communications director should also collect:
i. Behavioral measures of audience response.
MANAGING THE INTEGRATED MARKETING COMMUNICATIONS PROCESS
As defined by the American Association of Advertising Agencies, integrated marketing communications (IMC) is a concept of marketing communications planning that recognizes the added value of a comprehensive plan.
A) Such a plan evaluates the strategic roles of a variety of communications disciplines such as general advertising, direct response, sales promotion, and public relations and combines these disciplines to provide:
4) Maximum impact through the seamless integration of messages
B) Unfortunately, many companies still rely on one or two communication tools.
C) This practice persists in spite of the fragmenting of mass-markets into:
4) A multitude of mini markets each requiring its own approach.
5) The proliferation of new types of media
6) The growing sophistication of consumers
Media coordination can occur across and within media types.
D) Personal and non-personal communication channels should be combined to achieve maximum impact.
E) A single-vehicle, single-stage campaign is a one-time mailing offering a cookware item.
F) A single-vehicle, multiple-stage campaign would involve successive mailings to the same prospect.
G) A more powerful approach is the multiple-stage campaign.
H) Multiple media deployed within a tightly defined time frame can increase message reach and impact.
I) Research has shown that promotions can be more effective when combined with advertising.
J) Many companies are coordinating their online and off-line communication activities.
Integrated marketing communications has been slow to take hold for several reasons:
6) Large companies employ several communications specialists to work with their brand mangers who know comparatively little about the other communication tools.
7) Many global companies use a large number of ad agencies located in differing countries and serving different divisions.
8) Today a few larger agencies have substantially improved their integrated offerings and call themselves communications companies
D) They have acquired promotion agencies
E) Public relations firms
F) Package-design consultancies
G) Web-site developers
H) Direct mail houses
D) The result is integrated and more effective marketing communications and a much lower total communications cost.
E) Integrated marketing communications can produce stronger message consistency and greater sales impact.
F) It forces management to think about every way the customer:
E) Comes in contact with the company
F) How the company communicates its positioning
G) The relative importance of each vehicle
H) Timing issues
3) It gives someone the responsibility to unify the company’s brand images and messages as they come through the thousands of company activities
4) IMC should improve the company’s ability to reach:
C) The right customers
D) With the right messages
E) At the right time
F) In the right place